Constrain-thy-neighbor effects as a determinant of transnational interest group cohesion

This article identifies conditions for transnational interest group cohesion by examining German and British employer positions on EU company law proposals. Employers were divided over proposals on takeover bids but formed a united front against proposals on worker participation. I argue that divergent “constrain-thy-neighbor effects” contribute to explaining the observed variation. Actors consider not only how it affects them if they themselves are subjected to an EU law. They also consider how it affects them that the same law will apply abroad. Positive constrain-thy-neighbor effects weaken transnational cohesion. Negative constrain-thy-neighbor effects reinforce it. This argument and analytic framework could be applied to many issues beyond the realm of company law, and to all actors confronted with proposals for cross-border cooperation, including not just employers, but also governments, unions, and a broad range of organized interests. By attending to the multidimensionality of actors’ decision-making calculus, the article advances the materialist literature on preference formation in two ways. It bridges the artificial chasm between class-centered and firm-centered perspectives, and it shows how interaction between national and international institutions shapes preferences and cleavages.